Tokyo Gas : Financial Results for FY2021 ended March 2022

April 27, 2022

Consolidated Financial Results Bulletin for the Fiscal Year Ended March 31, 2022 (J-GAAP)

Tokyo Gas Co., Ltd.

Securities code: 9531

(URLhttps://www.tokyo-gas.co.jp/IR/english/index.html)

Representative: Mr. UCHIDA Takashi, President Contact: Mr. KOMORI Rikiya, Chief Manager,

Consolidated Settlements Sect.

General shareholders' meeting schedule: Scheduled date of the filing of securities report: Scheduled date of the start of dividend payments: Preparation of earnings presentation material (yes/no): Holding of earnings announcement (yes/no):

Stock listings:

Tokyo Stock Exchange, Nagoya Stock Exchange

Location of head office: Tokyo

June 29, 2022

June 29, 2022 June 6, 2022

Yes

Yes (for institutional investors)

(Amounts are rounded down to the nearest million yen)

1. Consolidated Performance for FY2021 ended March 31, 2022 (from April 1, 2021 to March 31, 2022)

(Unit: million yen)

(1) Consolidated Business Performance

(% of change from the corresponding period of previous year)

Net sales	Operating profit	Ordinary profit	Profit attributable to owners of parent
FY2021 ended Mar. 31, 2022 FY2020 ended Mar. 31, 2021	2,145,197 21.5% 1,765,146 -8.3%	117,777 51.6% 77,675 -23.4%	126,732 79.8% 70,500 -31.3%	88,745 79.3% 49,505 14.3%

Note: Total comprehensive income

FY2021 ended March 31, 2022: 98,859 million yen (188.6%)FY2020 ended March 31, 2021: 34,259 million yen (-14.7%)

Profit per share	Diluted profit per share	Ratio of profit to shareholders' equity	Ratio of ordinary profit to total assets	Ratio of operating profit to net sales
FY2021 ended Mar. 31, 2022 FY2020 ended Mar. 31, 2021	201.84 yen 112.26 yen	- -	7.5% 4.3%	4.3% 2.7%	5.5% 4.4%

Reference: Profit or loss on investment accounted for by equity method

FY2021 ended March 31, 2022: 3,725 million yen

(2) Consolidated Financial Position

FY2020 ended March 31, 2021: 1,482 million yen

(Unit: million yen)

Total assets	Total net assets	Equity ratio	Net assets per share
As of Mar. 31, 2022 As of Mar. 31, 2021	3,216,942 2,738,348	1,256,566 1,178,271	38.1% 42.1%	2,791.95 yen 2,616.37 yen

Reference: Shareholders' equity

As of March 31, 2022: 1,227,198 million yen

(3) Consolidated Cash Flows

As of March 31, 2021: 1,153,813 million yen

(Unit: million yen)

Cash flows from operating activities	Cash flows from investing activities	Cash flows from financing activities	Cash and cash equivalents at end of period
FY2021 ended Mar. 31, 2022 FY2020 ended Mar. 31, 2021	145,227 255,574	-224,656 -295,911	90,490 52,009	179,699 157,811

2. Dividend

Dividend per share (Unit: yen)	Total dividend payments (Full-year) (Unit: million yen)	Payout ratio (Consolidated)	Dividend on equity (Consolidated)
End of 1Q	End of 2Q	End of 3Q	End of 4Q	Full-year
FY2020 ended Mar. 31, 2021 FY2021 ended Mar. 31, 2022	- -	30.00 30.00	- -	30.00 35.00	60.00 65.00	26,460 28,585	53.4% 32.2%	2.3% 2.4%
FY2022 ending Mar. 31, 2023 (Forecast)	-	32.50	-	32.50	65.00	-

3. Consolidated Results Forecast for FY2022 ending March 31, 2023 (April 1, 2022 - March 31, 2023)

(Unit: million yen)

(% of change from the corresponding period of previous year)

Net sales	Operating profit	Ordinary profit	Profit attributable to owners of parent	Profit per share
Full-year	2,530,000	17.9%	140,000	18.9%	127,000	-0.2%	92,000	3.7%	211.69

*Notes

• (1) Significant changes in consolidated subsidiaries (changes in specified subsidiaries resulting in change of scope of consolidation during the year) (yes/no): No

  Reference: Scope of consolidation and application of equity method

  Number of consolidated subsidiaries: 113 (Increased by 8 companies and decreased by 2 companies) Number of subsidiaries and affiliates accounted for by equity method: 16 (Increased by 1 company)

• (2) Change in accounting policies or estimates and retrospective restatements

  • 1) Change in accounting policies in accordance with revision of accounting standards: Yes

  • 2) Change in accounting policies other than item 1) above: No

  • 3) Change in accounting estimates: No

  • 4) Retrospective restatements: No

• (3) Number of issued shares (common stock)

(Unit: share)

1) Number of issued shares at end of period (including treasury stock):	Mar. 31, 2022	440,996,559	Mar. 31, 2021	442,436,059
2) Number of shares of treasury stock at end of period:	Mar. 31, 2022	1,448,431	Mar. 31, 2021	1,437,924
3) Average number of shares during period:	Apr. 2021- Mar. 2022	439,672,718	Apr. 2020- Mar. 2021	441,005,584

(Reference)

1. Non-Consolidated Business Results for FY2021 ended March 31, 2022 (April 1, 2021 - March 31, 2022)

(1) Non-Consolidated Business Performance

(Unit: million yen)

(% of change from the corresponding period of previous year)

Net sales	Operating profit	Ordinary profit	Net income
FY2021 ended Mar. 31, 2022 FY2020 ended Mar. 31, 2021	1,921,391 19.1% 1,612,911 -9.8%	42,169 -10.4% 47,069 -24.1%	38,234 -18.2% 46,764 -31.6%	30,834 -27.5% 42,516 -25.0%

Profit per share	Diluted profit per share
FY2021 ended Mar. 31, 2022 FY2020 ended Mar. 31, 2021	70.13 yen 96.41 yen	- -

(2) Non-Consolidated Financial Position

(Unit: million yen)

Total assets	Total net assets	Equity ratio	Net assets per share
As of Mar. 31, 2022 As of Mar. 31, 2021	2,307,392 2,110,568	811,949 805,000	35.2% 38.1%	1,847.24 yen 1,825.41 yen

Reference: Shareholders' equity

As of March 31, 2022: 811,949 million yen

As of March 31, 2021: 805,000 million yen

2. Non-Consolidated Results Forecast for FY2022 ending March 31, 2023 (April 1, 2022 - March 31, 2023)

(Unit: million yen)

(% of change from the corresponding period of previous year)

Net sales	Operating profit	Ordinary profit	Net income	Profit per share
Full-year	2,208,300 14.9%	70,800 67.9%	76,700 100.6%	56,700 83.9%	130.47 yen

* Quarterly review procedures by a certified public accountant or an audit firm do not apply to quarterly consolidated financial results bulletins.

* Explanation related to appropriate use of results forecasts and other items warranting special mention

• 1. Consolidated and non-consolidated results forecasts include numerous elements of uncertainty, such as the impact of the COVID-19. Therefore, the forecasts are subject to drastic changes depending on future developments. For details of the above forecasts, please refer to "1. Overview of Business Performance, etc. (2) Future outlook" on page 6 of the Attachment.

• 2. The information related to this Financial Results will be posted on the Web site of the Company.

Contents of Attachment

I.	Overview of Business Performance, etc. ................................................................................................................... 2
(1)	Overview of business performance and financial position of FY2021 .................................................................... 2
(2)	Future outlook ............................................................................................................................................................. 6
(3)	Basic policy on profit sharing and dividends for FY2021 and FY2022 .................................................................. 7
II.	Group Companies ....................................................................................................................................................... 7
III.	Basic Concept Regarding Selection of Accounting Standards ................................................................................ 7
IV.	Consolidated Financial Statements and Main Notes ............................................................................................... 8
(1)	Consolidated balance sheets ....................................................................................................................................... 8
(2)	Consolidated statements of income and comprehensive income ........................................................................... 10
(Consolidated statement of income) ......................................................................................................................... 10
(Consolidated statement of comprehensive income) .............................................................................................. 11
(3)	Consolidated statements of changes in net assets ................................................................................................... 12
(4)	Consolidated statements of cash flows ................................................................................................................... 14
(5)	Notes on consolidated financial statements ............................................................................................................. 16
V.
(1)
(2)

• 1) (Note on going concerns' premise) ........................................................................................................................... 16

• 2) (Additional information) ........................................................................................................................................... 16

• 3) (Change in accounting policies) ................................................................................................................................ 17

• 4) (Segment information, etc.) ...................................................................................................................................... 18

• 5) (Per share information) ............................................................................................................................................. 21

• 6) (Material subsequent events) .................................................................................................................................... 22

Non-Consolidated Financial Statements ................................................................................................................. 23

Balance sheets ............................................................................................................................................................ 23

Statements of income ................................................................................................................................................. 25

I. Overview of Business Performance, etc.

(1) Overview of business performance and financial position of FY2021 (Business performance of FY2021)

During the fiscal year under review, the Japanese economy was expected to recover due to the effect of infection control measures and improvements in overseas economies, despite continued restrictions on economic activities, with new waves of the spread of the novel coronavirus (COVIC-19) infections occurring intermittently. However, the outlook of the economy remains unclear due to factors such as concerns over a resurgence in infections caused by variant strains of the virus and the situation in Ukraine.

Amid this economic climate, competition between energy operators in the energy industry as well as competition across industry borders have intensified due to the full deregulation of retail gas sales in April 2017 that followed the full deregulation of retail electric power sales in April 2016. The environment surrounding the energy business experienced major changes, including decarbonization becoming a global trend. Against this backdrop, we actively undertook various measures to enhance the added value we deliver to customers in Japan and abroad through the development of a comprehensive energy business and globalization.

COVID-19 has continued to affect the Company in many ways. In the city gas business, residential demand from customers staying at home declined from the previous fiscal year, as customers went out more and spent less time at home due to the lifting of the state of emergency at the end of September 2021 and the gradual easing of movement restrictions. Industrial demand has not reached the level before the spread of the pre-pandemic levels, and food and beverages are still affected.

The electric power business saw a rise in sales volume mainly due to an increase in the number of retail sale transactions, despite the impact of a drop in demand from customers staying at home. In the overseas business, there was an improvement in earnings due in part to a rise in selling prices in the LNG business, etc. in Australia and North America on the back of a global rise of market prices. In the energy-related business, delays in delivery brought about by a global shortage of semiconductors and a shortage of component supply due to the spread of infections in Southeast Asia caused a decline in sales volume of gas equipment products, etc. In the real estate business, rent income increased as large-scale properties operated throughout the year.

In light of these economic conditions and changes in the business climate, consolidated net sales for the year under review totaled ¥2,145.1 billion, a rise of 21.5% year on year and operating expenses came to ¥2,027.4 billion, an increase of 20.1% year on year.

Extrapolating from this performance, operating profit was ¥117.7 billion, an increase of 51.6% year on year, and ordinary profit totaled ¥126.7 billion, a rise of 79.8%. Profit attributable to owners of the parent came to ¥88.7 billion, a growth of 79.3% year on year. This reflected the posting of a ¥4.1 billion gain on sales of investment securities and a ¥2.2 billion gain on sales of non-current assets as extraordinary income, a ¥3.7 billion impairment loss on the real estate business, etc. and a ¥2.4 billion loss on valuation of investment securities as extraordinary losses, and income taxes.

1) Gas

The sales volume of the city gas business, which is the main business of the gas segment, was 13,131 million m3 in the fiscal year under review, an increase of 1.1% year on year. Breaking this down, residential demand was 3,077 million m3, a decrease of 4.0%, primarily due to a drop in demand as customers spent less time at home.

Commercial demand was 2,248 million m3, a decline of 0.6%, mainly due to a drop in the number of customers. Industrial demand was 6,197 million m3, an increase of 7.1%, primarily due to an increase in sales volume to users dedicated to power generation.

Supply to other utilities was 1,609 million m3, a drop of 7.2%, owing mainly to a drop in customer demand.

Gas sales came to ¥1,440.0 billion, an increase of ¥297.3 billion or 25.9% year on year, owing mainly to an increase a rise in gas unit price reflecting resource cost adjustments.

As a result of a rise in gas sales volume and an increase in city gas resource costs due to a rising trend in crude oil prices compared to the previous fiscal year, the overall operating expenses increased ¥283.0 billion or 26.7%.

Consequently, segment profit totaled ¥102.6 billion, an increase of ¥14.2 billion or 16.0% year on year.